‘The EV subsidies were a Faustian bargain’: Canada’s auto sector is in big trouble

Video

Rudyard Griffiths and Sean Speer analyze the major blow to Canada’s automotive sector as Stellantis moves Jeep production from Brampton, Ontario to Illinois, despite $15 billion in government subsidies for electric vehicle battery manufacturing. They argue this decision exemplifies the failure of Canada’s industrial policy approach to electric vehicles.

You can listen to this episode on Amazon, Apple, and Spotify.

Program Transcript

This is an automated transcript. Please check against delivery.

RUDYARD GRIFFITHS: Big auto news out today. Car manufacturer Solantis heading to Illinois, moving production out of Brampton, Ontario, taking a lot of jobs and a lot of future investment with it. To help break it all down and explain what it means, I’m joined by Shawn Spear, my co founder and editor at large. Shawn, you and I decided we had to jump on this story today. It connects with a whole lot of what’s going on in the country right now. The negotiations with Trump, the, the Carney government’s budget that’s coming up in a couple weeks and just how we’re responding to what is a giant sucking sound that’s emerged at our southern border, especially here in Ontario, over the last number of months. Let’s get your top line thoughts and then we’ll dig into it.

SEAN SPEER: Yeah, as you say, this, this story has different storylines there. It could be a conversation to be had about the ill conceived idea to try to engineer an electric vehicle industry using protections and subsidies, but maybe we’ll take that up on another day. As you say, this is in keeping with something that we’ve been talking about for a long time, which is we needed to understand the Trump administration’s motivation around tariffs, not merely as a negotiating place deploy, but as an industrial strategy to try to pull capital and production, particularly from Canada and Mexico, because of our proximity and because of our integrated nature, into the United States over the tariff wall in order to access the US Market. This isn’t the first instance, Rudyard, but it may indeed be the biggest. And you get the sense that Mark Carney, Doug Ford, even Pierre Poliev are reckoning with the fact that this isn’t, as you’ve often said, a bug, but a feature of tariffs in the mind of President Trump and his administration.

RUDYARD GRIFFITHS: Yeah, let’s dig into this bit more because the back history here, Sean, that makes this announcement today especially sting the movement of, I guess the Jeep that we’re all familiar with from Brampton into the United States with a commitment by Stellantis for a $13 billion investment in U.S. manufacturing. Cellantis was the recipient of one of Justin Trudeau’s battery plant deals, initially a billion dollars in subsidies from the Ontario government and the feds. Cellantis basically said that that wasn’t enough and that they were going to go with the Biden administration’s investment infrastructure spending. And they got the governments of Ontario and the feds Trudeau to up the total subsidies, including tax breaks, to $15 billion to keep Stellantis here, to keep this EV plant. So I just don’t get it, Sean. How are we kind of not walking and chewing gum at the same time? Why, on one hand have we given $15 billion to Stellantis to continue with this battery plant in southern Ontario, yet they’re now off the hook for this entire production line in Brampton, and they’re just announcing a 13 billion do that? I assume they and their shareholders are funding in the United States like this. We’re losing and then we’re losing again.

SEAN SPEER: Yeah, well said. It speaks in a way, Rudyard, to the mug game that is industrial policy with respect to Canada’s auto sector. I mean, let’s call a spade a spade. It’s been now decades, successive governments across the political spectrum, including the Harper government, of which I was a part of, deciding in Ottawa that thou shall have an auto sector and using the levers of government to essentially compete with other jurisdictions to induce that capital in production here in Canada. We have to understand, though, that those choices, at least in Canada, particularly in the past couple of decades, have not been a function of market fundamentals. They’ve been a function of how much governments are prepared to essentially pony up. And so we shouldn’t be surprised to discover that those companies don’t have deep commitments to the Canadian market. And this is just the latest example. I don’t know if we’ll get to it, but just if I can make a plug, Rudyard.

It also has to be understood in a context in which, on one hand, government policy is engineered or sought to engineer EV industry out of nothing in Canada. And at the same time, we’ve made a series of choices, including, of course, the EV tariffs on Chinese imports that has come at the expense of Canada’s Canola sector, a sector, it should be said, that is global leading and doesn’t require protections and subsidies in order to sustain it. So the trade off here is pretty stark. It speaks in my mind to the kind of folly of trying to generate an EV sector out of government policy. And on top of all of that, reinforces, as we’ve been discussing for some time, that the Trump administration is trying to create a huge sucking sound out of Canada when it comes to capital and production.

RUDYARD GRIFFITHS: Well said, Sean. Look, I get it, you know, hindsight is 20 20, but this, this really is a mess. Like, we went deep into these battery plants under Justin Trudeau, approximately $50 billion worth of direct and indirect subsidies afforded to a variety of manufacturers, including Cellantis. And now we’re in a situation where GM just announced quarterly results yesterday, racking up over one and a half billion dollars of losses related to EVs. Why? One, consumer demand is not there for EVs. Second, they found out that the Trump administration canceled the tax breaks. EV purchasers were getting some $7,500 per car. That’s a real dent in future EV production and demand. So here in Canada, we went, you know, head over heels for EV because it aligned with, you know, a green strategy. But we now, in a sense, made a deal to freeze out the Chinese autos with the Biden administration on the basis that there would be an integrated market for EVs. And I assume that integrated market would include these US subsidies going forward. Well, the US subsidies are gone. Canola farmers are losing hundreds of millions of dollars as a result of our tariffs, significant tariffs on Chinese EVs which match the US tariffs.

And now we’re in a situation where the entire kind of North American policy framework that would have justified the EV batteries and the $50 billion budget has gone away because of something called an election in the United States and a new administration with a new set of policies. So, Sean, I come back to you. I see no adjustment from our elites here at the provincial or federal level, either in terms of the lobbying industry around autos or in terms of our politicians like Mark Carney and Doug Ford to acknowledge that the whole game has changed. The assumptions that led to, I think that we thought they were faulty in the first place and we warned against them at the hub that the EV subsidies, you know, was a, was a Faustian bargain that was going to lead, to. Lead to tears. And sure enough, here we are, Sean. But I see no signs out of our political class or the lobbying class or in fact, the subsidized kind of welfare industry that’s grown up around autos in southern Ontario that they acknowledge that everything has changed. Everything has changed. And we’re not just losing Stellantis to the United States. We’re not just paying billions of dollars of foregone revenue to canola farmers. We’re still chugging along as if there could be some EV industry here in Canada that warrants large scale public support.

SEAN SPEER: There’s so much to say in response. You know, the net effect, as you say, is now the government is going to have to step in and support both auto workers, and I suspect we’ll have an announcement sooner rather than later on that front. And canola farmers who, as you say, have been blocked out of being able to sell their goods into the Chinese market, a hugely lucrative market for them because Canadian policy essentially traded off the interests of electric vehicles at the expense of canola farmers. There is just something kind of fundamentally broken in the way we’re thinking about our relationship with the United States and we’re thinking about the basic foundations of Canada’s economy. We’ve been arguing for a long time that in the face of the Trump administration threats, we don’t need to double down on the wrench from capitalism. We need to make our economy more competitive, such that even in the face of large scale tariffs would still be attractive for companies like Stellantis to continue production in Canada.

And just to make one final point, to emphasize that this isn’t merely a partisan critique, although, as you say, Justin Trudeau’s government sent us down this path. Even today, Pierre Polyev and the Conservatives are not fundamentally challenging the assumptions of the EV subsidies. They’re just arguing that they would have done, in effect, a better job than the Liberals in securing employment undertakings and investment undertakings and so on in exchange for the subsidies themselves. So we now have a political consensus in favor of throwing good money after bad for an EV industry that has no market basis, even if it comes at the expense of Canada’s global leading canola industry, which finds itself collateral damage and squeezed out of a major market, all because our political class decided, which brings me back to my very first point, that Canada must have an EV industry, that there was something stamped on the heart of of of Canada or something, that this is an industry we’d have and we would do whatever it took, production subsidies, mandates, tariffs, et cetera, to make it happen. The net effect is we’re poor, we’re poorer for it, and both southwestern Ontario and western Canola farmers are the victims of that policy.

RUDYARD GRIFFITHS: Yeah, and you could have justified that policy if the Biden administration had won reelection and you made these deals because you were going to get access to a fast growing North American, primarily American market for, for EVs. But that’s gone away. Trump has removed the subsidies. He’s now raiding Our auto sector and supposedly loyal favored auto manufacturers like Stellantis, who’ve gotten billions of dollars of tax subsidies and will continue to draw those down to build this EV plant in southern Ontario. I don’t know where those batteries will go or what future losses they’re gonna have to internalize. They’re pulling up whole production lines, like this Jeep line out of Brampton and sending it down to Illinois. My last thought on this, Sean, is like, it goes back to just a fundamental thing that we’ve argued over and over again here at the Hub. We have to produce things that the world wants. It’s very simple. This does not require PhDs to figure out. You have to say, what do we have and what does the world want? What can we sell at world prices? Oil, energy, liquefied natural gas, canola wheat. There are other industries where we also excel in southern Ontario that are not autos, like food processing.

It’s not glamorous, but we’re really, really good at it. And there’s great technology that we apply to it and we punch above our weight. I just. Sean, I’ll give you the last word. I just don’t understand this, as you say, this inability to see the auto sector in southern Ontario for what it is. It is a version of the cod fisheries of the maritimes of the 1980s. And we know how that ended. It ended. And I’m all for a transition and I’m all for treating these workers well, but we need to move on. We need to upskill them, re skill themselves, get them into industries where they’re like mining. There’s another thing. We’re selling a lot of gold to the world right now. Critical minerals. There’s all kinds of other jobs and industries in Canada that people can be productive in who can have livings in that are not dependent on manufacturing markets out of thin air through some combination of government legislation and subsidies, along with compliant companies who kind of go along because at the end of the day, they’re getting paid to go along to express the government’s political preferences with regards to EVs and the environment.

SEAN SPEER: Yeah, that’s precisely right. And even if in the short term, one can point to positive employment effects from those types of policies, as an economic model, it is inherently unsustainable. It only exists as long as the government is prepared to use the levers of policy, including productions and subsidies, to prop it up. And as soon as other jurisdictions offer a sweeter mix of productions and subsidies, or the government tries to withdraw its own, it becomes patently patently clear how unsustainable it is. These are difficult issues. The transition, as you say, is painful and difficult. I don’t want to underestimate it, but that strikes me as a far more sustainable way to, to address these issues, rather than finding ourselves in this rat race of Ottawa deciding the economic structure of the country and then putting all of our resources towards achieving it. Especially because this particular case demonstrates that, that those choices don’t come without cost. There are collateral damage, including, including canola farmers. And so I think we need to see the seen and the unseen. And here it’s abundantly clear and it calls for a different way of doing economic policy in Canada.

RUDYARD GRIFFITHS: But you can’t, you can’t know the future. You have to bet on, you know, the big, broad themes, the value propositions of your economy. You can’t do this fine, detailed kind of engineering and policy to unlock some magical kind of reserve of value, in this case EVs. It’s just, it is falling apart before our eyes. Final question before you go, Sean, because I think we do like to try to think about solutions too here. If the Americans, and Lutnick was very clear about this last week, even after Carney left the White White House, that, you know, Canada could supply some parts to the US Auto manufacturing sector. But the future of auto manufacturing in North America was in the United States. We’ve seen the decision today by Stellantis that seems to confirm what Lutnick says. The Trump administration has canceled their own EV subsidies, so we no longer have an integrated North American market to sell electric cars and batteries into.

Should we drop the tariff on Chinese electric vehicles to release our canola industry, through no fault of its own, has had to pay now in lost profits and revenues, hundreds of millions of dollars because of China’s ban on canola imports from Canada. Should we drop those tariffs and say to ourselves, bring in the Chinese EVs, let’s buy Chinese cars, and let’s create some pressure for the American manufacturers, because let’s face it, they’re not our friends. They’re stealing our jobs, they’re stealing our plants. They are not negotiating in good faith with us, as with this Stellantis deal. And, and it’s time to drop the EV subsidies and acknowledge that there, you know, whatever dream there was of maintaining some integrated North American auto market, especially focused around EVs, has come and gone.

SEAN SPEER: Yeah. This is obviously a torturous decision, but I, at this stage, Rudra would argue yes. Now let me say, if we were prepared to have A more fundamental question, a discussion about the future of Canada’s relationship with China, and we wanted to revisit it in a more basic way. I’d be open to those conversations, but that’s not happening. Of course. We’re continuing post pandemic to have, by and large the same relationship with China, say for a small number of particular areas like Huawei’s network technology or whatever. And so if it’s going to be business as usual with China, which seems to be the political view of both the Conservatives and the Liberals that as we’ve talked a lot about over the past several months, it’s not obvious to me that the EV tariff was motivated by geopolitics or some kind of security issue. It was, for all intents and purposes, about protecting Ottawa’s bad dollars after good on subsidizing the EV industry itself. There’s no broader strategic interest in my mind. And so for all of those reasons, I think, yeah, we should eliminate the EV tariff and in turn ostensibly secure access to the US market or the Chinese market for our canola exports and let the chips fall where they may with the United States.

RUDYARD GRIFFITHS: Yeah, look, if the Americans are going to treat us like this, I’m all for buying supposedly what are excellent Chinese electric vehicles with cutting edge battery technology at like half the cost of their American and Canadian manufactured counterparts. That sounds like affordability to me. That sounds like savings. That sounds like an international division of labor. I’m happy the Chinese can make electric.

SEAN SPEER: Vehicles all day long and progress on climate change. You and I are not as motivated by these issues as some others, including of course, the Trudeau Carney government. But was the EV agenda about essentially buying jobs or was it about reducing emissions? If it, if it’s about buying jobs, and these were pretty expensive jobs, and if it’s about reducing emissions, that, as you say, granting Canadians access to lower cost and more efficient environmentally friendly vehicles strikes me as the right way to go about achieving lower emissions in Canada.

RUDYARD GRIFFITHS: Especially since the Carney government’s gotten rid of the vehicle mandate so fleets don’t have to be 100% EV by, what was it, Sean, 2035, that we were supposed to achieve that goal, that’s now been removed. That was the right call. But it’s just. Shawn, everything is like.

SEAN SPEER: Everything that was there that was in.

RUDYARD GRIFFITHS: Place to create this, like, future for EVs is gone. And not only is it gone, the Americans have turned predatory on us when it comes to auditing. Yet we’re just, you know, Einstein’s definition of insanity. We’re doing the same thing over and over again and expecting a different result.

SEAN SPEER: Here here.

RUDYARD GRIFFITHS: Good conversation. We went a bit longer than we thought. But this is complicated and simple at the same time. We hope our community has enjoyed this. Please check out our YouTube channel. Check out our podcast on any of your favorite audio apps. Sean will catch up with you again soon. Be well. Take care, everyone. Bye. Bye.

SEAN SPEER: Bye. You bet.

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Rudyard Griffiths and Sean Speer analyze the major blow to Canada’s automotive sector as Stellantis moves Jeep production from Brampton, Ontario to Illinois, despite $15 billion in government subsidies for electric vehicle battery manufacturing. They argue this decision exemplifies the failure of Canada’s industrial policy approach to electric vehicles. You can listen to this episode on Amazon, Apple, and Spotify. Program Transcript This is an automated transcript. Please check against delivery. RUDYARD GRIFFITHS: Big auto news out today. Car manufacturer Solantis heading to Illinois, moving production out of Brampton, Ontario, taking a lot of jobs and a lot of future investment with it. To help break it all down and explain what it means, I’m joined by Shawn Spear, my co founder and editor at large. Shawn, you and I decided we had to jump on this story today. It connects with a whole lot of what’s going on in the country right now. The negotiations with Trump, the, the Carney government’s budget that’s coming up in a couple weeks and just how we’re responding to what is a giant sucking sound that’s emerged at our southern border, especially here in Ontario, over the last number of months. Let’s get your top line thoughts and then we’ll dig into it. SEAN SPEER: Yeah, as you say, this, this story has different storylines there. It could be a conversation to be had about the ill conceived idea to try to engineer an electric vehicle industry using protections and subsidies, but maybe we’ll take that up on another day. As you say, this is in keeping with something that we’ve been talking about for a long time, which is we needed to understand the Trump administration’s motivation around tariffs, not merely as a negotiating place deploy, but as an industrial strategy to try to pull capital and production, particularly from Canada and Mexico, because of our proximity and because of our integrated nature, into the United States over the tariff wall in order to access the US Market. This isn’t the first instance, Rudyard, but it may indeed be the biggest. And you get the sense that Mark Carney, Doug Ford, even Pierre Poliev are reckoning with the fact that this isn’t, as you’ve often said, a bug, but a feature of tariffs in the mind of President Trump and his administration. RUDYARD GRIFFITHS: Yeah, let’s dig into this bit more because the back history here, Sean, that makes this announcement today especially sting the movement of, I guess the Jeep that we’re all familiar with from Brampton into the United States with a commitment by Stellantis for a $13 billion investment in U.S. manufacturing. Cellantis was the recipient of one of Justin Trudeau’s battery plant deals, initially a billion dollars in subsidies from the Ontario government and the feds. Cellantis basically said that that wasn’t enough and that they were going to go with the Biden administration’s investment infrastructure spending. And they got the governments of Ontario and the feds Trudeau to up the total subsidies, including tax breaks, to $15 billion to keep Stellantis here, to keep this EV plant. So I just don’t get it, Sean. How are we kind of not walking and chewing gum at the same time? Why, on one hand have we given $15 billion to Stellantis to continue with this battery plant in southern Ontario, yet they’re now off the hook for this entire production line in Brampton, and they’re just announcing a 13 billion do that? I assume they and their shareholders are funding in the United States like this. We’re losing and then we’re losing again. SEAN SPEER: Yeah, well said. It speaks in a way, Rudyard, to the mug game that is industrial policy with respect to Canada’s auto sector. I mean, let’s call a spade a spade. It’s been now decades, successive governments across the political spectrum, including the Harper government, of which I was a part of, deciding in Ottawa that thou shall have an auto sector and using the levers of government to essentially compete with other jurisdictions to induce that capital in production here in Canada. We have to understand, though, that those choices, at least in Canada, particularly in the past couple of decades, have not been a function of market fundamentals. They’ve been a function of how much governments are prepared to essentially pony up. And so we shouldn’t be surprised to discover that those companies don’t have deep commitments to the Canadian market. And this is just the latest example. I don’t know if we’ll get to it, but just if I can make a plug, Rudyard. It also has to be understood in a context in which, on one hand, government policy is engineered or sought to engineer EV industry out of nothing in Canada. And at the same time, we’ve made a series of choices, including, of course, the EV tariffs on Chinese imports that has come at the expense of Canada’s Canola sector, a sector, it should be said, that is global leading and doesn’t require protections and subsidies in order to sustain it. So the trade off here is pretty stark. It speaks in my mind to the kind of folly of trying to generate an EV sector out of government policy. And on top of all of that, reinforces, as we’ve been discussing for some time, that the Trump administration is trying to create a huge sucking sound out of Canada when it comes to capital and production. RUDYARD GRIFFITHS: Well said, Sean. Look, I get it, you know, hindsight is 20 20, but this, this really is a mess. Like, we went deep into these battery plants under Justin Trudeau, approximately $50 billion worth of direct and indirect subsidies afforded to a variety of manufacturers, including Cellantis. And now we’re in a situation where GM just announced quarterly results yesterday, racking up over one and a half billion dollars of losses related to EVs. Why? One, consumer demand is not there for EVs. Second, they found out that the Trump administration canceled the tax breaks. EV purchasers were getting some $7,500 per car. That’s a real dent in future EV production and demand. So here in Canada, we went, you know, head over heels for EV because it aligned with, you know, a green strategy. But we now, in a sense, made a deal to freeze out the Chinese autos with the Biden administration on the basis that there would be an integrated market for EVs. And I assume that integrated market would include these US subsidies going forward. Well, the US subsidies are gone. Canola farmers are losing hundreds of millions of dollars as a result of our tariffs, significant tariffs on Chinese EVs which match the US tariffs. And now we’re in a situation where the entire kind of North American policy framework that would have justified the EV batteries and the $50 billion budget has gone away because of something called an election in the United States and a new administration with a new set of policies. So, Sean, I come back to you. I see no adjustment from our elites here at the provincial or federal level, either in terms of the lobbying industry around autos or in terms of our politicians like Mark Carney and Doug Ford to acknowledge that the whole game has changed. The assumptions that led to, I think that we thought they were faulty in the first place and we warned against them at the hub that the EV subsidies, you know, was a, was a Faustian bargain that was going to lead, to. Lead to tears. And sure enough, here we are, Sean. But I see no signs out of our political class or the lobbying class or in fact, the subsidized kind of welfare industry that’s grown up around autos in southern Ontario that they acknowledge that everything has changed. Everything has changed. And we’re not just losing Stellantis to the United States. We’re not just paying billions of dollars of foregone revenue to canola farmers. We’re still chugging along as if there could be some EV industry here in Canada that warrants large scale public support. SEAN SPEER: There’s so much to say in response. You know, the net effect, as you say, is now the government is going to have to step in and support both auto workers, and I suspect we’ll have an announcement sooner rather than later on that front. And canola farmers who, as you say, have been blocked out of being able to sell their goods into the Chinese market, a hugely lucrative market for them because Canadian policy essentially traded off the interests of electric vehicles at the expense of canola farmers. There is just something kind of fundamentally broken in the way we’re thinking about our relationship with the United States and we’re thinking about the basic foundations of Canada’s economy. We’ve been arguing for a long time that in the face of the Trump administration threats, we don’t need to double down on the wrench from capitalism. We need to make our economy more competitive, such that even in the face of large scale tariffs would still be attractive for companies like Stellantis to continue production in Canada. And just to make one final point, to emphasize that this isn’t merely a partisan critique, although, as you say, Justin Trudeau’s government sent us down this path. Even today, Pierre Polyev and the Conservatives are not fundamentally challenging the assumptions of the EV subsidies. They’re just arguing that they would have done, in effect, a better job than the Liberals in securing employment undertakings and investment undertakings and so on in exchange for the subsidies themselves. So we now have a political consensus in favor of throwing good money after bad for an EV industry that has no market basis, even if it comes at the expense of Canada’s global leading canola industry, which finds itself collateral damage and squeezed out of a major market, all because our political class decided, which brings me back to my very first point, that Canada must have an EV industry, that there was something stamped on the heart of of of Canada or something, that this is an industry we’d have and we would do whatever it took, production subsidies, mandates, tariffs, et cetera, to make it happen. The net effect is we’re poor, we’re poorer for it, and both southwestern Ontario and western Canola farmers are the victims of that policy. RUDYARD GRIFFITHS: Yeah, and you could have justified that policy if the Biden administration had won reelection and you made these deals because you were going to get access to a fast growing North American, primarily American market for, for EVs. But that’s gone away. Trump has removed the subsidies. He’s now raiding Our auto sector and supposedly loyal favored auto manufacturers like Stellantis, who’ve gotten billions of dollars of tax subsidies and will continue to draw those down to build this EV plant in southern Ontario. I don’t know where those batteries will go or what future losses they’re gonna have to internalize. They’re pulling up whole production lines, like this Jeep line out of Brampton and sending it down to Illinois. My last thought on this, Sean, is like, it goes back to just a fundamental thing that we’ve argued over and over again here at the Hub. We have to produce things that the world wants. It’s very simple. This does not require PhDs to figure out. You have to say, what do we have and what does the world want? What can we sell at world prices? Oil, energy, liquefied natural gas, canola wheat. There are other industries where we also excel in southern Ontario that are not autos, like food processing. It’s not glamorous, but we’re really, really good at it. And there’s great technology that we apply to it and we punch above our weight. I just. Sean, I’ll give you the last word. I just don’t understand this, as you say, this inability to see the auto sector in southern Ontario for what it is. It is a version of the cod fisheries of the maritimes of the 1980s. And we know how that ended. It ended. And I’m all for a transition and I’m all for treating these workers well, but we need to move on. We need to upskill them, re skill themselves, get them into industries where they’re like mining. There’s another thing. We’re selling a lot of gold to the world right now. Critical minerals. There’s all kinds of other jobs and industries in Canada that people can be productive in who can have livings in that are not dependent on manufacturing markets out of thin air through some combination of government legislation and subsidies, along with compliant companies who kind of go along because at the end of the day, they’re getting paid to go along to express the government’s political preferences with regards to EVs and the environment. SEAN SPEER: Yeah, that’s precisely right. And even if in the short term, one can point to positive employment effects from those types of policies, as an economic model, it is inherently unsustainable. It only exists as long as the government is prepared to use the levers of policy, including productions and subsidies, to prop it up. And as soon as other jurisdictions offer a sweeter mix of productions and subsidies, or the government tries to withdraw its own, it becomes patently patently clear how unsustainable it is. These are difficult issues. The transition, as you say, is painful and difficult. I don’t want to underestimate it, but that strikes me as a far more sustainable way to, to address these issues, rather than finding ourselves in this rat race of Ottawa deciding the economic structure of the country and then putting all of our resources towards achieving it. Especially because this particular case demonstrates that, that those choices don’t come without cost. There are collateral damage, including, including canola farmers. And so I think we need to see the seen and the unseen. And here it’s abundantly clear and it calls for a different way of doing economic policy in Canada. RUDYARD GRIFFITHS: But you can’t, you can’t know the future. You have to bet on, you know, the big, broad themes, the value propositions of your economy. You can’t do this fine, detailed kind of engineering and policy to unlock some magical kind of reserve of value, in this case EVs. It’s just, it is falling apart before our eyes. Final question before you go, Sean, because I think we do like to try to think about solutions too here. If the Americans, and Lutnick was very clear about this last week, even after Carney left the White White House, that, you know, Canada could supply some parts to the US Auto manufacturing sector. But the future of auto manufacturing in North America was in the United States. We’ve seen the decision today by Stellantis that seems to confirm what Lutnick says. The Trump administration has canceled their own EV subsidies, so we no longer have an integrated North American market to sell electric cars and batteries into. Should we drop the tariff on Chinese electric vehicles to release our canola industry, through no fault of its own, has had to pay now in lost profits and revenues, hundreds of millions of dollars because of China’s ban on canola imports from Canada. Should we drop those tariffs and say to ourselves, bring in the Chinese EVs, let’s buy Chinese cars, and let’s create some pressure for the American manufacturers, because let’s face it, they’re not our friends. They’re stealing our jobs, they’re stealing our plants. They are not negotiating in good faith with us, as with this Stellantis deal. And, and it’s time to drop the EV subsidies and acknowledge that there, you know, whatever dream there was of maintaining some integrated North American auto market, especially focused around EVs, has come and gone. SEAN SPEER: Yeah. This is obviously a torturous decision, but I, at this stage, Rudra would argue yes. Now let me say, if we were prepared to have A more fundamental question, a discussion about the future of Canada’s relationship with China, and we wanted to revisit it in a more basic way. I’d be open to those conversations, but that’s not happening. Of course. We’re continuing post pandemic to have, by and large the same relationship with China, say for a small number of particular areas like Huawei’s network technology or whatever. And so if it’s going to be business as usual with China, which seems to be the political view of both the Conservatives and the Liberals that as we’ve talked a lot about over the past several months, it’s not obvious to me that the EV tariff was motivated by geopolitics or some kind of security issue. It was, for all intents and purposes, about protecting Ottawa’s bad dollars after good on subsidizing the EV industry itself. There’s no broader strategic interest in my mind. And so for all of those reasons, I think, yeah, we should eliminate the EV tariff and in turn ostensibly secure access to the US market or the Chinese market for our canola exports and let the chips fall where they may with the United States. RUDYARD GRIFFITHS: Yeah, look, if the Americans are going to treat us like this, I’m all for buying supposedly what are excellent Chinese electric vehicles with cutting edge battery technology at like half the cost of their American and Canadian manufactured counterparts. That sounds like affordability to me. That sounds like savings. That sounds like an international division of labor. I’m happy the Chinese can make electric. SEAN SPEER: Vehicles all day long and progress on climate change. You and I are not as motivated by these issues as some others, including of course, the Trudeau Carney government. But was the EV agenda about essentially buying jobs or was it about reducing emissions? If it, if it’s about buying jobs, and these were pretty expensive jobs, and if it’s about reducing emissions, that, as you say, granting Canadians access to lower cost and more efficient environmentally friendly vehicles strikes me as the right way to go about achieving lower emissions in Canada. RUDYARD GRIFFITHS: Especially since the Carney government’s gotten rid of the vehicle mandate so fleets don’t have to be 100% EV by, what was it, Sean, 2035, that we were supposed to achieve that goal, that’s now been removed. That was the right call. But it’s just. Shawn, everything is like. SEAN SPEER: Everything that was there that was in. RUDYARD GRIFFITHS: Place to create this, like, future for EVs is gone. And not only is it gone, the Americans have turned predatory on us when it comes to auditing. Yet we’re just, you know, Einstein’s definition of insanity. We’re doing the same thing over and over again and expecting a different result. SEAN SPEER: Here here. RUDYARD GRIFFITHS: Good conversation. We went a bit longer than we thought. But this is complicated and simple at the same time. We hope our community has enjoyed this. Please check out our YouTube channel. Check out our podcast on any of your favorite audio apps. Sean will catch up with you again soon. Be well. Take care, everyone. Bye. Bye. SEAN SPEER: Bye. You bet.

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